Buying or leasing a car is a decision that’s not to be taken lightly. It’s an expensive asset regardless of what car make or model you go for. Small decisions made during the car-buying process can often lead to significant, long-term expenses, whether it’s thousands in interest or high and unexpected maintenance costs. If you’re neglecting vehicle history or not taking the time to properly research car brands, then mistakes are made that might hinder you financially for years later. Let’s take a look at some of the small car buying decisions that might cost you big later on.
1. Focusing Only on the Monthly Payment
When you’re focusing just on the monthly payment, you’re not thinking about the rest of the expenses that come with owning a car. Not just that, but the total purchase price can be forgotten about, which can be problematic for some people who are stuck in a loan that’s six or seven years long.
The longer the loan agreement is, the higher the total interest payment will be over the life of the loan. Therefore, it’s good to be aware of all the smaller details within the contract when you’re making monthly payments. Of course, it doesn’t matter when you’re buying the car outright.
However, not everyone has the financial ability to do that easily and so relies on finance instead.
2. Accepted dealer-installed add-ons
When you’re buying from a dealership, they aim to get as much money out of you as possible, and that’s beyond just the sale price of the car. They’re going to offer you a variety of add-ons and upgrades, like a cleaning kit for your car’s interior, and finishes on the car that you perhaps don’t really need.
Taking on extras like paint protection, rustproofing, and alloy wheel insurance when it comes to financing the car can often cost you thousands more than the final total paid. Many of these items are often unnecessary for those who are new to buying a car, or can be bought for much cheaper elsewhere.
Don’t get lulled into the sales pitch that these dealers provide, when many of the options they offer
3. Skipping the Vehicle History Check
All vehicles will come with a vehicle history check, and it’s your responsibility to make sure you see this before you agree to the purchase of any car, whether it’s done privately or through a dealership.
A vehicle history check will give you a complete breakdown of everything to do with the car and how much has been paid out for it over time. As well as all the fixes and repairs, it’s good to know the full extent of the vehicle history so that you can be sure what you’re paying for is what you are happy to commit to.
When there’s a car with hidden accident damage, a salvaged title, or outstanding finance, this can result in astronomical and unexpected repair costs down the road.
4. Overlooking Long-Term Running Costs
Buying a car based solely on the purchase price, rather than the total cost of ownership, which is different from the total cost of purchase, can be a major mistake. Many vehicles will vary based on their insurance premiums, fuel efficiency, or road tax.
This can increase your overall annual budget, and in some cases, that might not be something you can afford in the long-term. Therefore, you want to be mindful of all the various costs you’re going to be tasked with paying over the term of the loan.
You also want to make sure that these costs are something you can pay in full and to the end of the loan, planning for any eventuality where your finances might change in the future.
5. Skipping the Test Drive or Skimping on it
One of the most important things when it comes to buying a car is doing a test drive. This will be an indicator of how well the car drives in comparison to what you’re used to and whether you like the feel of the drive. Anyone who is driving the car on a regular basis should be test-driving it.
You don’t want to skimp on the test drive either. Make sure you’re taking it on a fairly good distance around the local area in order to get a real feel for the car. By doing this, you avoid missing out on any potential issues like with the gearbox, suspension, or brakes.
Taking the time to test drive is one that will help identify problems that would otherwise become a costly fix later down the line.
6. Choosing Features Based On Aesthetics Rather Than Maintenance
If you’re selecting larger alloy wheels or opting for advanced technology features, then this can often lead to high maintenance costs later on.
Unusual car colors can also be difficult to resell, as well as reducing the car’s future value. Unless you’re planning to hold onto this car for as long as it will continue running, it’s always good to think about the resale value when you’re customizing it.
Be aware of the aesthetic choices you make and how they might influence your costs through various maintenance needs over time.
7. Failing to Arrange Financing Beforehand
When you’re arranging finance, the last thing you want to do is have no available finance offer to query with the dealership when they provide their own financing opportunities. Taking the first financing offer from the dealership is often going to result in you getting a worse rate.
Securing a loan rate beforehand can provide a benchmark so that you’re getting a fair deal if you decide to opt for the car dealership’s financing.
When it comes to buying a car, it’s always good to be mindful of all those little decisions you’ll be making in the process. Experts will often recommend that a 2-3 year old used car will offer the best value, as you avoid the steep initial depreciation, and you’ll also have a vehicle that hasn’t entered its high-maintenance territory yet.
Either way, a good amount of research and time spent weighing up all the costs will ultimately help you to get the best deal possible.
